Magazine article American Banker

Rochester's FNB Says It Plans to Use Income from Branch Sales for Expansion

Magazine article American Banker

Rochester's FNB Says It Plans to Use Income from Branch Sales for Expansion

Article excerpt

After suffering the consequences of an ill-conceived expansion and poor lending, FNB Rochester Corp. is looking to grow again this time on its home turf.

After announcing its third branch sale in just over a year, $320 million-asset FNB, holding company of First National Bank of Rochester, wants to expand its paltry 2% market share in that city.

FNB plans to use the branch sale proceeds to open new offices in four or five Rochester-area municipalities where it is unrepresented, but president and chief executive R. Carlos Carballada declined to specify where or when.

"We would look at anything that might be available." he said, adding that FNB is in touch with its competitors to see if they're looking to divest any branches. "We'd like to get that done as quickly as we can."

The decision to grow also follows the bank's June release from a 1992 consent order with the Federal Reserve Bank, which came after FNB brought its leverage capital ratio into compliance at 6%. Another order with the Office of the Comptroller of the Currency was lifted March 7.

The change in market focus began after new executives joined the bank in June 1992 to"see if we could work to get the bank back on course again" by cleaning up its bad loans and changing its market focus, Mr. Carballada said.

"Classically, that's what hap*pens when a management team is brought in to clean up," said Kenneth F. Puglisi, managing director of Sandler O'Neill & Partners in New York. …

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